The post-Mullingar Discord… Labour and Fine Gael in 2008

Pat Leahy writing in the Sunday Business Post the other day noted something that I’d missed. When talking about the ‘fate of the opposition’ parties over the next twelve months he suggested that ‘…there is [a] significant cleavage emerging between the two main opposition parties following the failure of the so-called ‘Mullingar Accord’ to deliver power to Fine Gael and the Labour party’. He referenced the ‘rightward shift in policy and rhetoric’ of Fine Gael and how conversely the Labour Party is going ‘through a period of political retrenchment’. He argues that Gilmore is ‘hardly ‘old’ Labour but he’s happy to let Willie Pensroe et al sing the Red Flag to their hearts content if it keeps them happy… nor is he going to spend his time talking up Fine Gael’s Enda Kenny‘. All interesting points, are they not?

But there is a dynamic emerging between the two parties which is of particular fascination and he touches upon it when he notes that ‘the day before the Dáil broke up for the Christmas break, the chamber witnessed some pretty vicious exchanges between Fine Gael - specifically Leo Varadkar - and Labour deputies’.

So, that sent me searching the debate transcripts…

Vol. 644 No. 4 Competition (Amendment) Bill 2007: Second Stage (Resumed). Wednesday, 19 December 2007

Deputy Michael D. Higgins: In concluding this debate, I express my thanks to the 17 Deputies who spoke. The Bill is important and is certainly not a knee-jerk reaction. After all, it is just over two years since I wrote to the Taoiseach asking him to do something, in November 2005. Yesterday evening I outlined details of his letter to me in which he suggested that he agreed that ICTU was concerned. A previous version of this Bill existed and I received communication from the social partners asking me to withdraw my Bill so that the issue could be solved in the partnership talks. I deeply regret that that did not happen and that the Bill is not being allowed to proceed to Committee Stage, where all those who wanted to amend it would have the opportunity to make a contribution.

In the short time available to me, I would like to clarify a number of points. When I came into this House for the first time 20 years ago, I was told that when interpreting a Bill, it is important to interpret the entire Bill. One particular section cannot be taken and used out of context. This is advice that some of the younger Deputies should follow and they should avail of the courses on the interpretation of legislation that are provided by the commission. For example, section 2 of my Bill is qualified by section 3(2), which states: “Where the Government makes a declaration under this subsection that there is, in relation to a scheme to which this section applies, a public interest in negotiating a collective agreement between the public body concerned and an organisation that is representative of the profession concerned, providing for the terms …..” Therefore, there is a choice. I could have tried to strike down section 4, but I did not because I was not striking against competition.

The Minister of State, Deputy Michael Ahern, in a rather strange speech of 17 pages, devoted 14 pages to what one might call a hymn of praise to the Competition Authority and three and half pages to the Bill. He happened to get it wrong and I would like to clarify some points in law that are straightforward and clear. Article 81 and Article 82 of the EU Treaty only apply to transnational commerce. They do not apply directly into the State. They are translated into domestic law by the different member states. In the case involving Actors Equity, as part of SIPTU, and the Competition Authority, the latter clearly invoked a section of the domestic legislation. There is no point in sowing what is a dishonest confusion into the argument in that respect.

There may be many people who worry about bricklayers and stonecutters getting organised and referring to ancient guilds that might be established, as we heard last night. BATU is in existence and it has 9,000 members. It is in the building industry and it organises brick and stone layers, carpenters and joiners, as well as wood-cutting machinists. They enjoy a registered employment agreement so the Government is wasting its time if it wants to wish itself back to the 18th century, or if it wants to start advocating that little children should be climbing chimneys. Unions have every right to work against the process of casualisation. I believe that right is on the side of their argument. Reference was also made to farm workers. My party was founded in 1912 and we organised rural workers and there is a joint labour agreement that governs minimum rates.

In making his speech last night, the Fine Gael spokesperson said that there is a legal flaw in the Bill because it only amends the Competition Act 2002 and does not either the EU Treaty or the relevant EU regulations. That would be a nonsense because that is not what the Bill sets out to do. It sought to amend the Bill that gives compliance with the EU regulation and with the EU Treaty. He suggested that the Bill would be of no benefit to groups such as Actors Equity, as the Competition Authority’s rule is now based on Article 81 of the EU Treaty and not the Competition Act 2002. This is completely wrong.

Deputy Leo Varadkar: It was EC Council Regulation 1 of 2003.

Deputy Emmet Stagg: Shut up and listen.

An Leas-Cheann Comhairle: Deputy Michael D. Higgins, without interruption.

Well, okay then. some heat, but it could be worse, so I looked at the previous day. It was worse… (or better, depending upon political perspective).

Competition (Amendment) Bill 2007: Second Stage Tuesday, 18 December 2007

Deputy Leo Varadkar: I wish to share my time with Deputies James Reilly and Jimmy Deenihan.

An Ceann Comhairle: Is that agreed? Agreed.

Deputy Leo Varadkar: I acknowledge the bona fides of the Labour Party in presenting this Bill. It is a genuine effort to address genuine hardship for some individuals such as self-employed members of Equity, the NUJ and others. Similarly, I acknowledge the efforts the Labour Party is seeking to provide a means through which professional groups such as dentists, pharmacists and general practitioners can negotiate with Government for public services. However, despite this, neither I nor Fine Gael can support the Bill on a number of grounds, both to do with the ultimate policy implications of the Bill as drafted and legal flaws within it.

The explanatory memorandum suggests that section 2 has been brought in to facilitate Equity. However, the Bill does not refer to Equity and rather uses a broad-brush measure, section 2(1)(a), which effectively proposes to legalise across the board horizontal price fixing by trade associations at the expense of business groups and social partners. If this provision were enacted, it would be possible, for example, for architects to club together and demand a fixed price for services provided to particular contractors. Bricklayers could form a union and demand negotiations with the Construction Industry Federation for particular rights, such as double pay on Sundays. Casual farm workers could form a union in, say, the midlands and insist on negotiations with the IFA and farmers to give them particular employee rights while continuing to enjoy the benefits of being self employed.

Deputy Jan O’Sullivan: What about the public interest?

Deputy Leo Varadkar: When I refer to that, the Deputy will hear it. I am just dealing with section 2 of the Bill.

Deputy Michael D. Higgins: That section is qualified.

Deputy Leo Varadkar: I am coming to that. I did not interrupt the Deputy. Perhaps he could have the decency to contain himself for at least one debate.

Deputy Willie Penrose: We are fed up with the views coming from the Deputy.

An Ceann Comhairle: Deputy Varadkar is entitled to express his view.

Deputy Leo Varadkar: I am. This is a democratic country, left or right.

Deputy Willie Penrose: The Deputy is very “right”.

Deputy Leo Varadkar: Instead of competing for business, electricians in a town could form a union to negotiate terms, conditions and fees with local shopkeepers and enterprises. The Bar Council and the Law Society could similarly fix prices, terms and conditions for services provided to any social partnership group. This Bill is potentially a Trojan horse and if implemented would see a return of the medieval guild system of collective bargaining whereby architects and other professionals were required to form guilds in order to negotiate set prices for services, as well as creating barriers to others entering those services.

The Bill abolishes competition law to the extent that it applies to the self employed. As stated by the Competition Authority decision in the Equity case, if one were to take a wooden approach and find that all trade union members were exempt from the Act, the protection afforded to Irish consumers by the Oireachtas in the Competition Act 2002 could easily be rendered illusory. An association of independent pharmacists, publicans and barristers, to name but a few, would shortly obtain safe havens for their members by adding union to their name and obtaining negotiating licences. At the same time it is even possible that traditional companies could redefine themselves as partnerships and corporate bodies. Let us bear in mind that the Labour Party Bill does not just refer to individual self-employed people and unions, it talks about giving these rights to partnerships and corporate bodies. Traditional businesses could redefine themselves as collections of partnerships and corporate bodies and then use that provision to exempt themselves from competition legislation in the context of section 2.

Section 3 seems to be written with the intention of resolving the IPU-HSE impasse. I commend the Labour Party for seeking to resolve this problem but I do not believe this is the correct means to do so. However, despite the apparent intention, there is no specific mention of the IPU or similar organisations either in the Bill or the explanatory memorandum. The provisions of this section are very odd indeed. Essentially, it legalises price fixing in circumstances where the Government negotiates with an organisation representing a profession or trade for the provision of a service to members of the public or to a class of members of that public. The mechanism for achieving this is to empower the Oireachtas, following a declaration of the Government, to deem such an organisation not to be an association of undertakings for the purpose of section 4 of the 2002 Act. This exemption would not only be open to sole traders and independent professionals but also to members and employees of partnerships and corporate bodies under section 3(5)(b).

So, what’s going on here? Mullingar is clearly finished. And with its demise the necessity for Labour to reinforce its image and identity appears to be the main priority. Let’s not understate the difficulties that that presents in a polity where both of the larger political parties shift back and forth across the centre as it suits them. but this must be a God send. Here is a way to put clear red water between them and Fine Gael, and in the process there is the opportunity to paint at least some elements in Fine Gael with the same sort of colours that - at least in part - did for the Progressive Democrats. How ironic that ‘Thatcher’s Children’ should pop up in Fine Gael just as the economically liberal PDs leave the field of battle (and how tricky too for Labour… because if FG are to remain as putative coalition partners they have to do some hard thinking about policy… particularly since one B. Ahern will have departed to better things by 2012 and that particular excuse will be gone).

So, clearly there is a sense abroad in Labour that Varadkar - and perhaps his peers - is fair game for this sort of baiting, and indeed Varadkar has hardly been shy about projecting himself in the bear pit of the Dáil chamber as a muscular right winger. I can only imagine that this plays well with both Labour party members and a broader constituency on the left because. And this surely must colour the relations between the two parties and consequently that must have significant implications for the future political direction of the opposition. Already in this last Dáil term we have seen the intriguing sight of Labour and Sinn Féin working together. Now we are seeing a sort of political centrifugal force pushing Labour and Fine Gael away from each other.
While it is important not to overstate this, it is also worth considering that personal relationships between politicians tend to influence broader political issues. One might suggest tentatively that for both parties this is no time to be making new enemies, but for a Fine Gael still under the misapprehension that ‘one last push’ will lead them to government with or without Labours overt support that seems to be a message they are unlikely to listen to. As for Labour, well, what have they got to lose?

Leahy concludes by saying that the ‘new Fine Gaelers are as different from the old Labourites as they are from the old Fianna Failers. Those differences will become more apparent in 2008′. This should be fun…